The new generic top-level domain .XYZ has been on the upswing in recent months. That makes the scandal involving several top managers of XYZ.com, headed by CEO Daniel Negari, all the more relevant. The US Federal Trade Commission (FTC) has accused a number of the registry’s executives of illegally collecting personal data and then reselling it to third parties.
According to the FTC, Daniel Negari, along with COO Michael Abrose, business development manager Jason Ramin, general counsel Grant Carpenter, and two other employees not directly connected to the domain business, were involved in building a network of approximately 200 websites offering quick loans. But in fact, the sites harvested personal data from applications filled out by users. Then this information was resold to third parties, which included not only financial companies that actually provided loans but fraudsters as well.
Although the XYZ.com top executives were involved in this dubious business, the registry itself, apparently, had nothing to do with these transactions. All domains mentioned in the FTC papers that were used to collect personal data of loan applicants were registered in .COM, not in .XYZ. Thus, it would be unfair to blame the domain itself for the illegal activity. The current scandal may nevertheless spoil the reputation of the domain zone. Lawyer Derek Newman, who represents the XYZ.com executives, said the FTC’s allegations were “wholly without merit.” However, “litigation against the FTC is expensive and resource draining. For that reason, my clients chose to settle the case and move on with their business,” Domain Incite quoted the lawyer as saying. XYZ.com's top executives agreed to pay $1.5 million as a settlement.
